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J.P. Morgan & Co.11/12/2003
CERTIFIED FOR PUBLICATION
Proceedings in mandate after the court granted a motion to certify a class, Judge J. Michael Bollman. Petition granted.
The trial court certified this Cartwright Act case as a class action involving class members who are residents of 19 different states. (Bus. & Prof. Code, ยง 16700 et seq.) The moving party plaintiff was Heliotrope General, Inc. (Heliotrope or Plaintiff), a large-scale copper purchaser. Both this action and a companion action (National Metals, Inc. v. Sumitomo et al. (D041783, app. pending) (the companion action)) were brought by such copper purchasers against numerous defendants (as pertinent here, Defendants and Petitioners J. P. Morgan & Co., Incorporated et al. (J. P. Morgan).) Plaintiff's theory is that these defendants have manipulated the price of copper on the London Metals Exchange (LME) and on the American copper futures exchange, COMEX, through combinations in restraint of trade in violation of the Cartwright Act and through conspiracies to do so, to the detriment of copper purchasers in their private transactions on the physical or cash copper markets, as represented by the putative class representatives.
Defendants and Petitioners contend the trial court made an incomplete and erroneous analysis of the factors relevant to certification. We agree and conclude the certification order must be vacated, as the record does not support a finding of sufficient community of interest among the putative class members, in light of certain conflicts of interest among them. Also, the record does not demonstrate the required predominating common questions of law and fact regarding proof of fact of any classwide injury, nor that the rules regarding conflicts of laws considerations were properly applied here.
BACKGROUND
A. The Copper Trading Industry and Earlier Related Action
In 1996, Heliotrope, a purchaser of physical copper, brought its original class action complaint on allegations of price-fixing and antitrust violations in the copper market, similar to the allegations in the present action. (Heliotrope v. Sumitomo et al. (Super. Ct. San Diego County, 1996, No. 701679) (the prior action).) This prior action was heavily litigated and on October 10, 1997, Superior Court Judge Arthur Jones denied certification of a proposed class that was similar to this one, without prejudice. At that time, the court found that the proposed class was "unmanageable due to the degree of complexity in applying the laws of nineteen different states." Judge Jones retired and these related actions were assigned to Judge J. Michael Bollman.
The present action was filed June 6, 2000 by Heliotrope as a class action for antitrust violations against a number of different defendants, including J. P. Morgan and its related defendants. (Heliotrope General Inc. v. Credit Lyonnais Rouse, Ltd. et al. (Super. Ct. San Diego County, 1996, No. GIC749280).) It follows up on the original Heliotrope action but has a different class definition and more defendants. A number of defendants have settled this Heliotrope action, including GMMC, leaving J. P. Morgan and the related defendants as the only petitioners in this writ proceeding.
The prior Heliotrope action, as well as a related local action and others in different jurisdictions, were settled and Sumitomo and other defendants, such as Merrill Lynch, paid millions of dollars into a settlement fund, on which claims were made by various consumers of copper product and scrap/recycled copper product. Plaintiff's counsel represented to the trial court the settlement amounts exceed $75 million; in the opposition brief, it is stated five settlements h
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